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PIERS MORGAN LIVE

Three Generations of Buffetts

Aired October 22, 2013 - 21:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


PIERS MORGAN, CNN ANCHOR: Sanjay, not so fast, Mr. Bond, as they say in the movies, because that was a terrific exclusive and I watched it with great interest. A lot of people believing that Kathleen Sebelius should resign or indeed should be fired. To me, one of the most fascinating exchanges in the interview came when you asked her about the supposed A team, which she now said was working on Obamacare, and prompted you to ask, why weren't they there to start with? Tell me about that.

SANJAY GUPTA, CNN ANCHOR: Yes, it was quite extraordinary. I mean, the whole question is what happens now? It's been three weeks and obviously there's been some not just kinks or glitches but real failures of the system, and I think that was what I wanted to say, so what is your plan? And she said well, now we're going to bring in the A-Team to try and fix this, and I said the A team should've been here way prior to October 1st. So that was a pretty interesting exchange and again, she really does talk about the fact that there's been a lot of failures, but keeps going back to this idea that it's going to work eventually. We don't know when, we don't know how many people who have signed up, but we're going to get there. That's what she kept coming to.

MORGAN: Well, I have my own A team sitting here listening to all of this, the Buffett family. Warren Buffett, Howard Buffett, his son and, Howard, his grandson are looking forward to a fascinating hour with them, but before you go Sanjay, let's us talk a little bit more about this ObamaCare situation. What do you think the view w of the medical profession generally is? Are they of the belief that this is in the end, going to be a force for good or do they believe as many Republicans would have us believe that this is really deeply troublesome?

GUPTA: You know, it's interesting and it's very hard as you might imagine, Piers to think any large community including the medical one with one broad brush. I think what has happened over the last three weeks has, you know, there's been a little bit of an erosion of confidence. Having said that, I think, you know, most people in the medical community do buy into this idea that we need to make sure more people at least have access to health care not because it just -- not that the system would work without it.

I thought that Kathleen Sebelius about a variety of things including that. Take a listen.

(BEGIN VIDEO CLIP) GUPTA: The President did say that he was angry about this, I mean, do you know when he first knew that there was a problem?

KATHLEEN SEBELIUS, HEALTH AND HUMAN SERVICES SECRETARY: Well I think it became clear fairly early on the first couple of days that ...

GUPTA: So not before that though?

SEBELIUS: Yes.

GUPTA: Not before October 1st? There was no concern at that point even the White House or at HHS?

SEBELIUS: I think that we talked about having testing going forward and if we had an ideal situation and could've built the product in, you know a five-year period of time. We probably would've taken five years, but we didn't have five years.

(END VIDEO CLIP)

GUPTA: You know, Piers part of the reason that I asked that question is because you're going to hear over the next week or so that about 70 percent of insurers who are buying into this marketplace had concerns about it being rolled out on October 1st. We know that just days before the roll up, there had been a test done with just a few hundred sign ups and the system failed. I was just surprised that the President who's obviously been talking about this a lot wasn't made aware of these problems until a few days after October 1st. So I don't know what that conveys exactly, Piers but we thought that a lot of people would be more engaged including the President earlier.

MORGAN: She didn't seem entirely certain to me, it's whether she was going to resign or not if the problem persistent. What was your gut feeling when you finish the interview?

GUPTA: I mean, I asked her three separate ways, you know, I mean, and certainly, I'm not the only asking her this question. I did ask her about her own thoughts on resignation, what the President was saying to her. Take a listen.

(BEGIN VIDEO CLIP)

GUPTA: There's a lot of frustration, obviously, in the country and no one probably knows this better than you and the President. Did you ever talk about resigning to the President?

SEBELIUS: What I talked about is doing the job that I came here to do.

GUPTA: If this persist or even at this point now, would you consider resigning over this?

SEBELIUS: I think my job is to get this fully implemented and to get the website working right and that's really what I'm focused on.

(END VIDEO CLIP)

GUPTA: And to be fair, you know, there is six months in this open enrollment period. These three weeks have not been good. And again, Piers, I'm most concerned about people who are sort of on defense about this in the first place. How do they feel about this? Is this somewhat -- is this somehow emblematic of how they're going to feel about this plan going forward? I don't know. But those are some of her answers ,Piers.

MORGAN: Well, terrific interview Sanjay. Congratulations. Thank you very much, indeed. Now, to my primetime's Exclusive with three generations of Buffett, Warren Buffett, the Chairman and CEO of Berkshire Hathaway, has got to say about Washington, Wall street, ObamaCare, and much more and joins me exclusively with his son Howard G. Buffett and grandson Howard W. Buffett for the purposes of simplicity we will call H.W.B tonight.

Howard G. is the author of a fantastic new book, "Forty Chances, Finding Hope in a Hungry World." We'll get into that soon. Let's begin Warren, if I may, with your reaction to this whole ObamaCare business and in particular, Kathleen Sebelius. Many people looking at this as a business decision. Should the President stick with somebody who has so far, presided over what many think as being a business failure in terms of the information -- implementation of ObamaCare? What do you think?

WARREN BUFFETT, CEO AND CHAIRMAN, BERKSHIRE HATHAWAY: Well, it's a huge list but I'm a friend of Kathleen's and I'm a friend whenever she's in trouble. So speaking on behalf of the Z team, I, yeah, I like Kathleen. I feel sorry for her and the position she's in. Obviously, it's a huge screw up but it will get worked out.

MORGAN: In your experience, I mean, you're one of America's great businessmen, do you prefer, historically, with your people to stick by somebody when they've had a rocky period believing that they will be even more determined to succeed or sometimes, you just have to chop it up? What is your normal strategy?

WARREN BUFFETT: Occasionally, I have to chop it off, but basically, I believe in sticking by people. And pretty well when they're in trouble and, you know, I think on balance you develop a lot of loyalty with people that way and there's some people that -- where it goes beyond the point where you can stick with them but I mean, try to stick with them.

MORGAN: So you say, you judge them at many people say by his family, by his sons, his grand, grand children. When you look down the line here, what do you feel about these two guys?

WARREN BUFFETT: I would love to be judged by the two Howards. I feel very good about it. Fortunately, they got their mother's genes in them.

MORGAN: So for viewers tuning in, they all know you, Warren but it may not be so familiar with Howard or HWB here. Give me a little assessment of them starting with your son. WARREN BUFFETT: It started slow. I think for the first two or three years, we were thinking about putting him out for adoption. But he has evolved into it, a terrific human being and I'm proud of him and I love backing him in his terrible work and he's done the same with his sons so I feel really good about the children.

MORGAN: There is a reason that I feel extremely grateful to your son. I'm going to play you a clip which will explain why. This is from the last time I interviewed Howard.

(BEGIN VIDEO CLIP)

MORGAN: Lovely to see you.

HOWARD G. BUFFETT: Nice to see you, Piers.

MORGAN: I hope I can get you back one day with your father and maybe your son for the three generations of Buffetts.

HOWARD G. BUFFETT: I'll work on that.

MORGAN: I would love that.

HOWARD G. BUFFETT: All right. Thanks very much.

MORGAN: Lovely to see you.

HOWARD G. BUFFETT: You bet.

(END VIDEOCLIP)

MORGAN: Now, you see that moment was sealed with the famous Buffett handshake. And I knew then I had a deal because Howard, the Buffett handshake means a lot, right?

HOWARD G. BUFFETT: Well, what I've learned growing up in our family is that, you know, integrity is everything. And, you know everybody makes mistakes, but I believe as my dad says, you know, you stick with people, you give people a second chance, and that's the values that, you know, we've had in our family.

WARREN BUFFETT: I would give him more than a second chance.

HOWARD G. BUFFETT: Yeah.

(LAUGHTER)

HOWARD G. BUFFETT: I think I teed him up for that one.

MORGAN: We're going to come back to some of the fascinating deals you did when you're somebody when he was young, which I'm going to -- I've got three sons, I like the way you think about these things. Let me ask you on that -- on the handshake business. How many men in the world or women, people you do business with, do you trust personally for big a deal on a strength of a handshake, percentage-wise. WARREN BUFFETT: We -- Well, I don't -- it's not that 100 percentage but of the ones I made deals with, I decide that their handshake is good. We do not have contracts with -- we have 70 some companies. There maybe one or two contracts out there but basically you can't make a good deal with a bad guy, you know.

MORGAN: Regardless of any bit of paper?

WARREN BUFFETT: Regardless of any piece of paper. I mean, they win. I mean, they sue you and do all kinds of things, so.

MORGAN: And do you still prefer to do business with a handshake?

WARREN BUFFETT: Yes, I prefer to do business with people I like. I mean, you know, I see no reasons to do business with people who cause my stomach to churn. I think it's like marrying for money. I mean, it's kind of dumb, and I think it's really dumb if you're already rich, right?

MORGAN: But let me ask you, HWB, what is the single best lesson you have learned from the elder Buffetts in your life, so far would you say?

HOWARD W. BUFFETT: Well both my grandfather and my father have been the most amazing role models that anyone could imagine. And, you know, I've watched my grandfather build what has been one of the greatest fortunes in the world and turned it into one of history's greatest gifts and in doing so empowering my father to go out and change the world and take that opportunity ...

HOWARD G. BUFFETT: He's exaggerating.

HOWARD W. BUFFETT: No. And that's what ...

WARREN BUFFETT: The party is still on the will.

HOWARD W. BUFFETT: That's really, I mean that's what "Forty Chances" is all about. I mean, it's really been about what Howard -- what my dad has been able to do with that opportunity that my grandfather has given him.

MORGAN: Well, it's a great line that you used, Warren I think which is you also want to give your kids enough money that they could do whatever they wanted to do in life but not enough that they would do nothing.

WARREN BUFFETT: Yeah and that so they can do anything but not enough to do nothing.

MORGAN: We'll take a break, I want any viewers out there to tweet me some fascinating questions for any of the Buffetts and the one I like best -- or the one we will call that we like best will get a signed copy of this terrific book, "Forty Chances", signed by the whole family. And if you're really unlucky, I'll turn a copy of my own book, that's "Shooting Straight" which I will also sign to devalue it even more. So get tweeting. And when we come back after break, what's it like growing up in the Buffett household. I want to talk to you Howard and Warren about the car deal and about the deal involving the farm and your weight, Howard, you're brutal man Mr. Buffett.

WARREN BUFFETT: It never goes away. Never goes away.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Well the biggest lesson in a sense I got is the power of unconditional love. I mean, I think there is no power on earth like unconditional love. I think that if you offered that to your child and you're 90 percent on the way home.

(END VIDEO CLIP)

MORGAN: Warren Buffett back in 2010. One of the best advice ever received, I bet his wisdom is passed on from his father to him. And tonight, Warren Buffett is here with his own son, Howard G. Buffett and his grandson Howard W. Buffett. So we've got plenty of tweets pouring in Jane Fagan Smith (ph) said what's the most important advice you've ever had about investing that you would impart to others?

WARREN BUFFETT: Well, it's to look at stocks as part of the business rather than little things that blob up and down. So, you value the business and then you look at the stock. Sometimes people think that now the stocks are a little hundred, and the stocks going up next week, in the end, you're buying part of the business and you should never lose sight of that.

MORGAN: Do you have to personally enjoy the stocks that you buy big in?

WARREN BUFFETT: Well, I enjoyed them. I enjoy analyzing stocks but one thing to remember about stocks is you have all these feelings about them. They don't care about you. Yes, yeah, you bought the stock at 20 and now it's 18, you know, and you hate it. Stocks doesn't know -- it doesn't know what you paid, it has no feelings about you at all, so...

MORGAN: Well the reason I ask you is that when you were young, you were selling Coca-Cola. You then became a huge stockholder in Coca-Cola, when we asked the family involving you as well, what the writer (ph) would be for the dressing room requirements. So we used a major rock star writers, there was one request, anything Coca-Cola related?

WARREN BUFFETT: No.

MORGAN: So I thought this man actually drinks this stuff.

WARREN BUFFETT: Five a day. MORGAN: Now, here's the other thing I want to do for viewers because we have little moment just now at the break which we made be laugh so loudly and then he couldn't come back after the break which is we were discussing cellphones. So I'm a BlackBerry relic, I still hang on to the BlackBerry, it turns that HWB here has two BlackBerrys.

HOWARD W. BUFFETT: Yes.

MORGAN: Howard didn't bring any cellphone at all. Warren has something I haven't seen since a grandfather clock first gave him. Please.

WARREN BUFFETT: This is the one Alexander Graham Bell gave me. He's got a new one.

MORGAN: How long have you had that one?

WARREN BUFFETT: Well, I don't throw anything away until I got it 20 or 25 years.

MORGAN: (inaudible) seen one of those since Star Trek came out.

WARREN BUFFETT: This is pretty impressive actually that I can dial people on this. I can't do these other things where it talks about text.

MORGAN: Do you use e-mail?

WARREN BUFFETT: I do it through my assistant. No.

MORGAN: Maybe yourself.

WARREN BUFFETT: I sent one e-mail in my life.

MORGAN: Who to?

WARREN BUFFETT: I sent it to Jeff Wright at Microsoft and it ended up in court in Minneapolis court. So I am one for one.

MORGAN: And you still have your own car? Is that right?

WARREN BUFFETT: Well, it's not so old. It's about six years.

MORGAN: You're not into flash things, are you?

WARREN BUFFETT: Well, I have everything I want, you know, I'm happy.

MORGAN: Let's turn to your son because when I interviewed him nine months ago. We got him to some of the deals that you did together as father is so much I thought absolutely gripping. One of which was when you decided that ...

WARREN BUFFETT: We're not that gripping hand (ph).

MORGAN: So, how did you turned your backyard into a little farm and you want to do a deal with your dad about the rent. Explain to me what the deal was.

HOWARD G. BUFFETT: Well, actually that was 400 acres that HWB farms now and the deal was that the rent amount would be based on my weight.

WARREN BUFFETT: This was not a brilliant moment in parenting.

MORGAN: I mean, Warren what were you thinking? So, it was literally paid that if you put on weight, the rent went up.

HOWARD G. BUFFETT: Yeah.

MORGAN: And if you reduced your weight...

HOWARD G. BUFFETT: Unfortunately....

MORGAN: ... the rent went down?

WARREN BUFFETT: Yeah, and I try to feed him candy and pie and all this ....

HORWARD G. BUFFETT: Yet unfortunate, I kept paying the higher rate.

MORGAN: So it didn't work?

HOWARD G. BUFFETT: No, not really.

WARREN BUFFETT: No.

MORGAN: Conversely, there was an incentive scheme on a car that you wanted as a gift. Well, you wanted the money for it.

HOWARD G. BUFFETT: Yeah.

MORGAN: Tell me about that because that did work.

HOWARD G. BUFFETT: Well, you know, I knew that when I graduated from High School, I really want a car. So I went to my dad, I said, if I don't -- this is the beginning I ask was and for the next three years I don't get a birthday present or Christmas present, will you get me a car and he does and gave me $5,000 and back then it was actually quite a bit of money and ...

WARREN BUFFETT: Still is.

HOWARD G. BUFFETT: ... see the problem ideally? It's a big problem.

(CROSSTALK)

HOWARD G. BUFFETT: And so when I graduated I had $5,000 and I had summer jobs, so I earned another $2300 and I bought a new car with it and I thought it was pretty good deal.

MORGAN: And what have you stopped rigidly to the terms of the deal so that...

WARREN BUFFETT: Of course.

MORGAN: ... so that there was no wavering on your part.

WARREN BUFFETT: It was a deal. No, it was a deal.

MORGAN: This deal, I mean it's instinct that the two incentives one worked and one didn't would you regret the weight incentive that you laid down with your son?

WARREN BUFFETT: I would say it was dumb. You know, we're still talking about it today.

MORGAN: And how would you lay this down on HWB here? Do you have the same criteria?

HOWARD G. BUFFETT: You know, I don't think I've ever done that. No, I just -- what I did as I would -- sometimes I tell him if he's going on a trip to some country he didn't want to go to. But, you know, I figured out it was educational. I don't think I've ever done that. Yeah.

MORGAN: All three of your children went to public school.

WARREN BUFFETT: That's true.

MORGAN: All three of them dropped out off college.

WARREN BUFFETT: Right.

MORGAN: You've always been pretty pragmatic about that.

WARREN BUFFETT: Yeah.

MORGAN: You don't seem to face, why?

WARREN BUFFETT: Well, for one thing, if they combine their credits, we can get one degree and that's

(Inaudible)

WARREN BUFFETT: I never thought, I didn't want to go to college myself. My dad talked me into it, but I think my kids got a wonderful education in public school. They went to the same school that their grandfather did, their mother -- to school, the inter city school that's been between 20 and 35 percent black for 75 years. They saw the real world and they saw what America is all about and I think it was a great education.

MORGAN: What were the key messages that you wanted to send your children which I guess you passed down as well to deal with the fact that there was enormous wealth from the family almost from when they were born.

WARREN BUFFETT: Well, they never felt that it was going to be passed on to create some dynasty or something. I always felt that we would live wonderfully and then the rest will go back to society and that's been the plan since I was in my 20s.

HOWARD G. BUFFETT: He hid it for a long time. He didn't know it affects.

MORGAN: Was he -- I don't want to use the word mean, but was he a little tight fisted out from the way you're painting this picture.

HOWARD G. BUFFETT: No, you painted it out. No, not at all. I mean, first of all, when ...

MORGAN: But what did he taught not to be too materialistic I guess would be the way I'll phrase.

HOWARD G. BUFFETT: Well, I don't think you can teach that. I just -- I think that's an observation and, you know, one of the biggest things you learn is what you observe and you know, I had two incredible parents and you know, my mom was the most giving person in the world. What I got from my dad was something very unique which was, you know, I used to eavesdrop on his business calls. I used to sit when he was talking about who is running for mayor.

MORGAN: And that must have been fascinating. But, you wouldn't hear one side of the call.

WARREN BUFFETT: Yes, but he can figure out what's going on. I prefer on only hearing one side of it.

MORGAN: Is it true Warren that basically you love to just do business on the phone. Now, that's a way you like to conduct business because you were somebody who has ...

WARREN BUFFETT: Sure, sure.

MORGAN: Just endless phone calls, how working (ph) doing the deal.

WARREN BUFFETT: Yes and it -- they don't take long. I mean that, we made the decision to buy the Burlington Northern Santa Fe Railroad. I was down there on a Thursday and I said to few people, "Is it OK if I offer him $100 are you here tomorrow?" And they said, "Fine." So, we bought it. I mean, it ...

MORGAN: Just like that. How much did you pay?

WARREN BUFFETT: $34 billion all of it. Yes.

HOWARD G. BUFFETT: And he's worried about $5,000.

WARREN BUFFETT: Watch the pennies.

MORGAN: That is fascinating. I mean, you must have unbelievable self belief, Warren to be able to make that kind of deal in a matter of hours. WARREN BUFFETT: If I'm operating within what I call my circle of confidence. I mean, there's all kinds of things I don't know how to do. But if I do feel, I know, when I -- certain area and that was not a problem making that decision.

MORGAN: Do you ever make big mistakes?

WARREN BUFFETT: Sure, sure.

MORGAN: What's been the biggest? That's -- If you look back, must be the one you think I should never have done that?

WARREN BUFFETT: Well, I bought company in the mid '90s called Dexter's Shoe and paid $400 million for it. It went to zero but I gave $400 million worth of Berkshire stock, which is now worth, I don't know, probably $4 billion.

So every time Berkshire goes up, I mean, it cost me more that dumb decision. But I've made lots of dumb decisions. That's just part of the game.

MORGAN: I'd love to make decisions that went wrong later. Yes, it makes a lot easier.

When we come back, we're going to talk about the woman you just mentioned. Your great mother, your great wife, the amazing impact she had on the whole family. Many say the brains really behind the power, would you agree with that Warren?

WARREN BUFFETT: Yes, I do. I would agree with that.

MORGAN: We will discuss it after the break.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SUSAN BUFFETT, LATE WIFE OF WARREN BUFFETT: I always thought I'd marry a minister or a doctor somebody out doing some valuable service to human beings. And the fact that I married somebody who makes just piles of money is really the antithesis of what I ever thought, but I know what he is. And he is -- there's no finer human being in who he is. So I overlooked the money.

(END VIDEO CLIP)

MORGAN: Warren Buffett's first wife, Susan back in 2004, what proved to be her first and only interview is an inspiration for the entire family.

I have three of the with me here tonight, Warren Buffett and his son and grandson, Howard G. and Howard W. Buffett.

Howard, you said earlier, your mother was extraordinary bigger in all your lives. Tell me why. HOWARD G. BUFFETT: Well, she is -- first of all, she did something, you had my dad saying earlier where she provided unconditional love to all three of us. She had incredible patience with me, which was a requirement I think to keep me in line and out of trouble and she cared about everybody. I mean, there's nobody that would meet her that didn't connect with her and feel a passion and a warmth from her and she really taught us how to care about other people and how important it is to treat every human being equally.

MORGAN: My favorite story in the book and there's so many powerful stories here in your travels, I'm going to come to this, where you go around the world doing extraordinary work with the foundation. A lot of it financed by your dad and ...

HOWARD G. BUFFETT: All of it.

MORGAN: ... and there's not (inaudible) it's amazing work that you do and we will come to this. But my favorite story is the time that your mother, very were -- unusually for her. Besides, she's had enough of you, locks you away in your bedroom, now most kids in that position and I've been in that position. You just sit their sulking and then eventually you're allowed back in to the community.

But not you Howard, what did you do?

HOWARD G. BUFFETT: Well, I had a roll of windows in my room and, you know, I open the window up, we had this greenhouse so I'd be careful climbing out because I don't want to go through the glass, but I got down and we had our charge account at the local hardware store about five blocks away and I went up there and I convinced the guy to let me charge a has plaque (ph) and buy a screw driver because I don't have any tools and I get everything I needed and I called back up in and I lock her out.

MORGAN: You changed the lock of your bedroom door because she thinks that (inaudible) ...

HOWARD G. BUFFETT: But I put a whole has plaque (ph) on it. I put in a whole new lock and put the screws in it and locked it out.

WARREN BUFFETT: He was the Hannibal Lechter.

MORGAN: I mean, I can't think of any other child I've ever met who would even think of doing that.

HOWARD G. BUFFETT: Well, I don't know. It's practical to me.

MORGAN: How did you mother react?

HOWARD G. BUFFETT: I think as it is, she probably got a kick out of it. I mean, she's all irritated that she couldn't get back in.

MORGAN: So, Warren, what do you make of a son that has such devilish mastermind capabilities.

WARREN BUFFETT: It was -- I worried for awhile as I mentioned in the book, we had Howie who was the second child, quite soon after the first child but as we had him, we decided to call a halt.

I should mention that interview incidentally, my wife had just had an oral cancer.

MORGAN: That's right.

WARREN BUFFETT: It impeded her speech but ...

MORGAN: Tell me about Susan for me because, you know, she was obviously this huge great love of your life and then amazing mother and wife. Tell me about it.

WARREN BUFFETT: Well, I was a mess when she met me. And matter of fact, in another part of that interview, she said what was her first impression of me and she said, "What a jerk."

Forcefully, she looked at me as a challenge. Maybe sort of preparing her for Howard, I mean, (inaudible) and she put me together and that -- it was -- it changed my life.

MORGAN: When you say she put you together, in what ways for the good? How did you change?

WARREN BUFFETT: I slowly grew up and I wouldn't otherwise at that. I was -- I just -- I wasn't feeling good about the world or myself and she just stood there with a little water in can and just sprinkled in front of the flower it bloomed.

MORGAN: Many great businessmen are incapable of real love or even real emotions sometimes. They get absorbed in business. Many people who don't know, I guess may have seem you're one of those characters, but from what the family, from what I've read and great biography about your snowball and others, you're not that man at all. You're capable of great emotion and great love.

WARREN BUFFETT: There's nothing like love, no.

MORGAN: Just to override, anything else you would write?

WARREN BUFFETT: Sure, sure. I mean, it's wonderful to love. It's wonderful to be loved.

MORGAN: I'll talk to you HWB about this. I mean you've have this extraordinary figures in your life, haven't you? An extraordinary father here, your grandfather, your grandmother, obviously. I mean tell me about what is like growing up in this kind of family.

HOWARD W. BUFFETT: Well, to be frank it's been normal in a sense that we grew up in a normal house. We grew up with normal cars. And, you know, we grew up being told that there was nothing different about us and anybody around us.

And so, that I think really help grounded us and who we've all become as part of this family. But having these values that have been so clearly -- I've seen at least stepping back -- pass down from my grandfather to my father and especially in the way that they each do their work in their own unique ways. It's been one of the most amazing things for me to observe and seat back and try and draw from as much as possible when watching the way that they've been successful.

MORGAN: Well, what are the key values that you would like to see other people recognize in your children, your grandchildren, your family or extended family?

WARREN BUFFETT: Well, I want them to be good citizens, good parents that the -- what the world would be better off because they were here.

MORGAN: What else? What makes a great character, I know that you think that one of the great rules of investing in life and business is character is one of the big things not getting into debt is another, but character a very important integrity. What is your definition of that?

WARREN BUFFETT: Well, I'm not sure I can give you a great one. But I know it when I see it and I know it when it exist around me, and I feel good about all three of my children but it wasn't always that way.

MORGAN: Just been working program.

WARREN BUFFETT: Yeah, there are a few years. But they felt the same way about me, I'm sure.

HOWARD W. BUFFETT: The second most important piece of advice that I have been given is to surround yourselves with people that have even greater integrity than you have, because all they do ...

HOWARD G. BUFFETT: Greater intelligence.

HOWARD W. BUFFETT: Yeah, and greater intelligence of course and it's easy for me to do.

WARREN BUFFETT: That's easy.

HOWARD W. BUFFETT: Yeah, exactly.

MORGAN: Has it been hard, Howard growing up with that surname.

HOWARD G.BUFFETT: Well, I tell you this there's a lot more benefit that there are, you know. I mean -- and so, you know, you get frustrated. But I will tell you, when you're younger growing up with it, it was frustrating at times. But, you know, today it's a huge advantage and what you really have to do is make sure you're responsible about it.

And, you know, I never felt much different as Howie is saying, I mean, you know, growing up in the house we grew up with neighborhood we grew up in I mean it just, you know, I didn't feel any different that I think anybody else felt.

WARREN BUFFETT: We've been in the same house now for 55 years.

MORGAN: In Omaha, the famous house.

WARREN BUFFETT: Yeah, absolutely. And that we got terrific neighbors, you know, Nancy brings over cherry pies. My wife Astrid loves it.

MORGAN: Have you ever gone buying like a liter or something? Warren do you ever do that to your ...

WARREN BUFFETT: Yeah. I go to the supermarket. I kind of enjoying looking around. Yeah.

MORGAN: And you all been here before we finish this interview we've got about half an hour left. I'm going to get you play the ukulele lately, possibly a better Frank Sinatra. I'm also going to get you to show the world your wallet. So, we need to think about (inaudible).

WARREN BUFFETT: My wife's had it.

MORGAN: So this is what your son told me.

WARREB BUFFETT: You want to see my wallet.

MORGAN: He said it's thread bare and dust and has cobwebs, right Howard?

WARREN BUFFETT: I'm not sure what are the time lock is.

MORGAN: Don't get it out yet.

WARREN BUFFETT: No, no.

MORGAN: We're going to surprise the viewers later. But he is carrying a wallet Warren Buffett and I'm going to examine it later in this show.

We'll be back after this break.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

WARREN BUFFETT: A great reputation, as I say, is like virginity, it can be preserved, but it can't be restored. At least that's what my dad told me.

(END VIDEO CLIP)

MORGAN: Warren Buffett speaking to Fortune Magazine behind in Washington's budget standoff on Mr. Warren Buffett speaks the world. And this is back now with Warren Buffett his son Howard G. Buffett, and his grandson Howard W. Buffett, great tweet us in from Reverend Nikki (ph) who says, "Warren Buffett just compared his son to Hannibal Lechter Piers Morgan. I am thinking this is an exaggeration". HOWARD G. BUFFETT: Completely. He doesn't know me.

MORGAN: Yeah. Howard tell me about this book "Forty Chances", why the title?

HOWARD G. BUFFETT: Well, the "Forty Chances" kind of sort of actually my career farming. I went to -- back in around 2001 or something. I went to what they call planter school which doesn't sound very exciting. And it was on a winter time and a lot of farmers kind of gather.

And there's a speaker there who said we're really doing things thinking about things wrong. And that when you think of, you know, once season blends into the other and then he said, you know, by the time your dad lets you climb on the tractor you climb off with your son or daughter climb on, you got about 40 crops, 40 seasons or 40 years to really make a difference. Do well in what you do and grow the best crop that you can grow.

And actually made me think about a few things differently in my farming, but what I really did was kind of made me think about this is a really a mindset in life, because you have maybe 40 prime years that you can -- you might have 80, but, you know it's really a mindset. I mean you got to bring urgency to what you do if you want to change something. You got to figure out how to do things at scale.

In our case we've got to take a risk because we want to learn what doesn't work as quickly as we can and let everybody else know what our failures are.

MORGAN: The main them of this is finding hope in a hungry world, feeding those who just can't afford to feed themselves in some of the most difficult places on earth.

One of the quandaries that you face, I mean you're very open about this is you sometimes can pump money into these areas and you never see it again. It gets squandered. It gets corrupted. It gets wasted. What have you learned about that battle? How do you deal with that?

HOWARD G. BUFFETT: Well, one of the biggest things I've learned is -- I mean there's a lot of great organizations out there. So, you know, I have confidence in where most the money goes. What happens is it doesn't get you to the results you want.

And so, you know, one of the things I learned in 2005 as an Angolan -- a villager in Angola and, you know, I had this woman trying to give me her child and I had to refuse to take the child. And that was a kind of pivotal moment because I went back and I figure it out the people with me, help me figure out what's it take to do the logistics, get the medical people there, the therapeutic feeding emergency. All the pieces that go into $4.5 million and that might get them through the next season depending on a lot of other factors but you can't take tens of thousands of villagers across the county with 54 countries and save it project by project. And so, that was when I really started to understand you have to do this a scale, you have to tackle a fundamental problems and you absolutely have to engage on advocacy which is something I had never done.

MORGAN: Where you pumped more and more money into Howard's Foundation I think over $3 billion you now have, you oversee the light the way that he's gone about trying to tackle this problem. What do you make of what he's achieved?

WARREN BUFFETT: Well, he's operating on a premise as are my other two children and with the Gates Foundation too that all lives have equal value. And from that he's taken this particular passion and his area of expertise farming and looked around the world and seeing that it can be done so much better by people and not by telling to them to do it like us but working with those conditions that they have. And, you know, it'll make a difference.

MORGAN: You're proud of him?

WARREN BUFFETT: I am very proud of him.

MORGAN: Let's take a break. Let's come back let's talk more Buffett I want an investment advice. We've lots of tweets saying, "Come on Warren, give us some tips."

HOWARD G. WARREN: The tip is to read "40 Chances."

MORGAN: Well of course.

WARREN BUFFETT: Yes, there's three or four stock at the back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

WARREN BUFFETT: Can you do any better on salary?

UNIDENTIFIED MALE: Unfortunately, that ranges at a corporate.

WARREN BUFFETT: What about miles (ph) when I use my car? I mean gas ain't cheap, you know.

UNIDENTIFIED MALE: We think that $0.25 a mile is pretty generous.

WARREN BUFFETT: How about $0.27 and when I make long business calls will they be monitored or it on the other assistant?

(END VIDEO CLIP)

MORGAN: More on Buffett negotiating with the gang on NBC is the office that led him the attention to details, I'm with his family, one of the most influential in the world back now with the three generations of Buffets, Warren, Howard G, and Howard W. Do you enjoy being actor there, Warren, well you're quite good? WARREN BUFFETT: I wouldn't say that, but nice thing about being mildly famous is that the worst you are the better people like it.

HOWARD G. BUFFETT: There are a lot of people who like it.

MORGAN: What is do you think most people when they see you in the street recognize you, ask you.

WARREN BUFFETT: Oh, they come up with it, you know, they say, "Are you really?" You know, and then I said, "No, I'm really much better looking."

MORGAN: OK, I would ask you whether you carry a wallet and what's inside it? If I was to ask you that now what might the answers be?

WARREN BUFFETT: Well, I must take a look.

MORGAN: This is a moment in television history. Is this Edward (inaudible) on television before?

WARREN BUFFETT: I got this wallet for -- here's my. ..

MORGAN: How long have you had it first?

WARREN BUFFETT: Probably about 20 years maybe.

MORGAN: And what do you had in it?

WARREN BUFFETT: Here's my American express card from 1964.

MORGAN: That's a green one.

WARREN BUFFETT: That's a green card, yes.

MORGAN: It's actually -- that's the original green Amex card.

WARREN BUFFETT: Oh, that is it.

MORGAN: That's the one you have the whole time?

WARREN BUFFETT: Yes, well it goes with my cellphone. I'd love that, yes.

MORGAN: What other cards do you have?

WARREN BUFFETT: Well, I've variety of card, but there's a picture of the family.

MORGAN: Yes.

WARREN BUFFETT: And...

MORGAN: And how much cash?

WARREN BUFFETT: More than usual that ... MORGAN: That must quite of load actually.

WARREN BUFFETT: There's some hundreds in there, but yes ...

MORGAN: How far ...

(CROSSTALK)

WARREN BUFFETT: Yes, right.

MORGAN: I have eventually seen greenhouse we saw on that, OK, it's going back in. Now, we've got a brilliant winner of the signed copy of "Forty Chances", Howard's book and a signed copy of my book, "Shooting Straight". This is a rollaway winners I'm calling into composition right now because when we saw all this one of my team just found this, the giveaway goes to a young man called Steven Hayes (ph) who tweet. I met Mr. Buffett as a college student three years in Omaha, what should I do with this pictures? Which I would say take it to the National Inquirer because here is the picture of Warren Buffett offering some interesting advice to this student which appears to be of the strangulation variety.

HOWARD G. BUFFETT: You know I recognize that.

WARREN BUFFETT: He is the last one who asked to take out bill folds.

MORGAN: That is what happens ladies and gentlemen if you ask Warren Buffett to show you his wallet. The strangulation -- anyway that young man will win the both signed copies for terrific photograph you send in there.

Let me ask you Howard of all the places you've been, of all the issues you've dealt with, what has been the most powerful to you personally?

HOWARD G. WBUFFETT: The resiliency of people. I've talked to -- I don't know if you saw the movie Blood Diamond but I've talked to hundreds of victims that survived the RUF attacks sincerely on during the conflict there that, you know, they had their -- they were offered a long sleeve, short sleeve, and they chop their arms and they replaces, it's amazing to watch this people figure out how to carry water back to their village. There's a child soldier in their little chromate who talked about how they slit his chest open, cocaine in him, made him drag a AK-47 because he was too young to carry at six. I mean all of this people hat we -- that we have the opportunity to meet in this really difficult circumstances the resiliency and the fact that so many of them don't give up hope. It's very ...

MORGAN: Well, it's pack full powerful stories. I already commend the book it's beautifully written, it's very evocative, and I don't think people will really enjoy it.

Warren let me tend you to the shutdown we just had and the debt ceiling crisis. Seems like (inaudible) on air in CNN in three years this will be some crisis involving Washington, debt ceilings, shutdowns, how do we try and bring an end to all this and actually move forward for the benefit of the American economy and the American people.

WARREN BUFFETT: I think that both party should declare the debt limit as a clinical weapon of mass distraction which can't be use. I mean it is silly to have a country that has a 237 years building up its reputation and then have people threatened to tear it down because they're not getting some other matter, it just -- it's so disproportionate to other issues.

So, the first thing to do is just take that off the table and what I really hope is that Ryan and Murray sit down and work out something probably at it's better and private and work out something that involves some real get one both sides and then presented for an up or down vote and I think the American public has been significant enough kind of irritated to discuss and what's happened to put a lot of pressure on something sensible to get through.

MORGAN: When you look at America's place in the world, you've always said, never bet against America.

WARREN BUFFETT: Never.

MORGAN: And I would certainly go along with that, an amazing country, amazing superpower, but there are rivals now to the super power stages, load to be China. What should America be looking to do going forward, it used to be this great manufacturing powerhouse. What is the future for America incorporated, do you think?

WARREN BUFFETT: Terrific, terrific. This country has worked for 237 years. Every generation is a little better than the ones before we've gone through civil wars, great world wars, depression, and everything else and America always moves ahead and we have not exhausted the potential or come close of our system.

So our best days well I had, I feel terrific for my son and my grandson.

MORGAN: And there are a lot of people tweeting me saying, "I've got a thousand dollars to spend, what should I be investing in?" Warren is the guy to ask.

WARREN BUFFETT: Well, you've asked. You've got your job.

MORGAN: That is why he is worth by this. I will show you a worth for a Buffett. Do you know how much your worth?

WARREN BUFFETT: Well, you can multiply the bag of purchase but it's all going to -- it's all going to (inaudible). There are every single share of (inaudible) every single share (inaudible) and I don't need it, I mean I've got everything I need. So it can do a lot for other people, it does nothing for me. So that's where it goes.

MORGAN: If you have any spare that you're just thinking it, and you go (inaudible). It's been fascinating to talk to all three of you. Congratulations for having a terrific book. UNIDENTIFIED MALE: Thank you.

MORGAN: "Forty Chances". We're going to comeback after the break with the piece of musical history because Warren Buffett has many talents and one of them is playing the ukulele, and he has vowed to get it out and play "My Way" by Frank Sinatra. This could be quite a moment.

(COMMERCIAL BREAK)

MORGAN: I'm back now with the Buffett family, Warren, Howard G, Howard W. I'm now supporting the fabulous 40 badge which means I'm a member of "Forty Chances" now. Pretty illustrious club, right?

HOWARD W. BUFFETT: Very few people.

MORGAN: And it means I've got -- I've had more than 40 chances here, but we've got some very useful timing but I'm looking forward to wearing this.

HOWARD G BUFFETT: We got 40 more.

MORGAN: Exactly. And the website is 40chances.com and you can actually make suggestions that you were saying to me just now, how and where people could suggest ideas for how you can spend money from the foundation.

HOWARD G. BUFFETT: Well we have (inaudible) people to get involved.

HOWARD W. BUFFETT: Oh yeah.

HOWARD G. BUFFETT: So if they read the book and they're inspired by any we're talking about, then they can go that we have a number of organization, ideas, and that type of thing. So they can actually go there too.

MORGAN: Brilliant. Well, listen we're going to comes this magnificent moment in musical history.

Have you ever met Frank Sinatra before he died?

WARREN BUFFETT: No, I've never met Frank Sinatra.

MORGAN: You're a fan?

WARREN BUFFETT: And I'm a fan.

MORGAN: And you were fan of ukulele?

WARREN BUFFETT: Yes, and you just have ...

MORGAN: Just to make it clear of you is Warren has not played this instrument before IN particularly, what we purchases in New York need today but we believe this is your one. He has had a little practice on it. You're ready to go. And this is Warren Buffett singing Frank Sinatra's "My Way".

WARREN BUFFETT: Joined by Piers ...

MORGAN: I was just a little bit of murmuring at your back.

WARREN BUFFETT: Let's do it, Howard. And now, the end is here. And so I face the final curtain. My friends, I'll say it clear, I'll state the ...

(CROSSTALK)

WARREN BUFFETT: ... on which I'm certain. I've lived the life that's full and traveled each and every highway. And more, much more than this, I did it my way. And that (inaudible)

MORGAN: Fabulous. That was absolutely fabulous.

HOWARD G BUFFETT: He has a lot of talent.

MORGAN: And we had at about 50 seconds left. I've been inundating with tweets, many of them are saying these Buffett boys are a lot of fun are they?

WARREN BUFFETT: We had a lot fun.

MORGAN: You don't do (inaudible) interview very often, Warren. How do you enjoy the last hour?

WARREN BUFFETT: I've enjoyed it a lot. I always enjoy a day with this and I've enjoyed this and I think maybe we can show up at the Grammies the two of us.

MORGAN: How would you like to be remembered?

WARREN BUFFETT: A teacher, teacher.

MORGAN: Yes.

WARREN BUFFETT: Well, actually I like to be remembered as the oldest man that ever lived. And make sure that's (inaudible).

MORGAN: And if there was one moment I can relive in your entire life again for you. Which moment would you choose?

WARREN BUFFETT: The time with my dad, that moment, any moment.

MORGAN: Just to see him again at a little bit of time.

WARREN BUFFETT: Absolutely.

MORGAN: Well, Warren and Howard, the HWB, I'm sorry. Thank you so much for invited me to become part of Forty Chances, it's a terrific cause, love the book.

HOWARD W BUFFETT: Thank you. MORGAN: Love the interview. Here it is. Howard G. Buffett with Howard W. Buffett "Forty Chances: Finding Hope in a Hungry World" terrific cause but it's packed with fun, it's packed with great advice, as you would expect anything with the word Buffett associated with it. It's been a great honor to me.

HOWARD G BUFFETT: And don't forget to stock us at the end.

MORGAN: It will be updated, eighth edition.

WARREN BUFFETT: Under track women actually.

MORGAN: How (inaudible) good to your word. You brought back your old man and your son, and it's been a terrific hour of television and I'm really grateful to all of you. Thank you all very much indeed.

WARREN BUFFETT: You've (inaudible) us.

MORGAN: (inaudible) thanks for the Buffett family joining me. That's all for us tonight. AC 360 starts right now.